If you have put up a loan application with a bank, then they will examine a lot of things before approving you the loan. They examine your income level, your credit score, address etc. to grant the loan. Now I am going to describe some of the major reasons because of that loan applications get rejected.
- Job Stability is Present or Not: Banks give a lot of significance to your job stability. An applicant also needs to be employed with a particular employer to a particular number of years to take loan from certain banks. So, if you jumps from one company to another too frequently or have an owner of a new business or you are a Professional with unusual source of income then you might not get the loan from your bank.
- Size of the organization in which you work: loan rejection could also be decided by the banks on the basic of industry, nature, size and age of the organization you are working with. They also look the number of employees working in the organization and whether the organization is public or private sector firm.
- Too Many Prior Debt Commitments to Meet: If your income is low and have a high prior debt burden then banks thinks before giving any new loan approval to such person as the chances of default increases in such cases.
- Bad Credit History: If your past credit history is not good then you can’t get new loan approval.
- Co-applicant has a Poor CIBIL (Credit Information Bureau India Limited) record: Record of Co-applicant also plays an important role in the approval of loan application, if your co-applicant’s CIBIL record is poor then you will face difficulty in your loan approval.
- Residential Address is Available on the Defaulters List: If bank finds your residential address available in the defaulters list then they do not approve loan to that customer. If your address matches with the address of any loan defaulter living with you then also your application will get rejection from the bank.
- Moved to a New City: If you have moved to a new city, you can find it difficult to get a loan approval.